Handbook On EPF and ESI CA Vivek Agarwal

HANDBOOK ON
EMPLOYEE’S PROVIDENT FUND AND

MISCELLANEOUS PROVISIONS ACT’ 1952
(Page 3 to Page 31)
AND
EMPLOYEES STATE INSURANCE ACT’ 1948

(Page 33 to Page 49)
COMPILED BY
CA VIVEK AGARWAL (FCA, ISA, B.Com.)
City Plaza, 4th Floor, Sevoke Road, Siliguri
West Bengal – 734001
| cavivekslg@gmail.com | 9832373066|
Handbook on :
Employee‟s Provident Fund and Miscellaneous Provisions Act‟ 1952
Employees‟ State Insurance Act‟ 1948
SECTION – 1
EMPLOYEE’S PROVIDENT FUND
AND
MISCELLANEOUS PROVISIONS ACT’ 1952
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Compiled by :
CA Vivek Agarwal (FCA, ISA, B.Com)
City Plaza, 4th Floor, Sevoke Road, Siliguri – 734001, West Bengal
| cavivekslg@gmail.com | 9832373066 |
Handbook on :
EMPLOYEES’ PROVIDENT FUND ORGANISATION
The Employees‘ Provident Fund Organisation is a statutory body under the Ministry of Labour,
Government of India, New Delhi. It administers Social Security Schemes framed under the
Employees‘ Provident Funds & Miscellaneous Provisions Act, 1952, namely Provident Fund, Pension
and Insurance to industrial employees. These benefits are extended to establishments which
employ 20 or more persons.
The Employees‘ Provident Fund Organisation is an All India Organisation having its offices in all
state capitals, cities, towns and districts with its headquarters at New Delhi. It is administered by
the Central Board of Trustees – Employees‘ Provident Fund comprising representatives from
employees, employers a nd the Central/State Government.
The Employees‘ Provident Fund is made applicable to an employee from the date of his joining the
establishment and recovers contribution at the rate of 12% of basic wages and the dearness
allowance and the employer also contributes his share of contribution @ 12 %. In addition to this,
the employers contribute an additional 1.36 % towards administrative charges (subject to certain
conditions discussed later). Every member of Provident Fund is automatically governed by Pension
and Insurance Schemes. Similar to government employees, the industrial employees are also
eligible to avail the monthly pension after their superannuation and family pension in case of
their death. During life time, a member can avail withdrawals from his Provident Fund for
Housing, Marriage, and Illness etc.
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Chapter I
TO WHOM THE PROVIDENT FUND ACT APPLIES?
(1) The Employees’ Provident Funds & Miscellaneous Provisions Act, 1952, is applicable to
–
All establishments/Factories; included in the list of notified Industries
and class of establishments. The minimum number of persons employed should
be 20. The Central Government after giving two months notice is empowered
to apply the act to any establishment employing less than 20 persons, by
notification in the official gazette.
‗Person‘ includes regular, casual, piece rated, part time, temporary and contract
employees, etc.
The Provident Fund Act will come into force in an establishment from the very
date of set up or commencement of business excepting certain class of
establishments specified excluded under Section 16 of the Act. The Act once
applied will continue to apply to the establishment even if the number of
employees fall less than 20 after coverage.
The Employees‘ Provident Fund Act is applicable to the cinema theatres
employing 5 or more workers.
(2) Registration – Issue of Provident Fund Code Number- to an establishment.

A Registration number, otherwise known as Code Number is issued to
every establishment/Factory to which the Provident Fund Act is applied.
It is issued by the Regional Provident Fund Commissioner under whose jurisdiction
the Establishment is located. Normally, in case of a Factory establishment, the
Code No. is allotted by the Regional Provident Fund Commissioner under whose
jurisdiction the Factory is located; and not with reference to the location of the
Head Office or the Administrative or corporate office. A contractor who is
employing 20 persons and engaged in the work of different establishments
may obtain a separate code number. The compliance should be
reported to all the establishments for which he is working as a contractor.
Presently, Code Number has to be applied online through the department‘s online
portal (www.epfindia.gov.in)
(4) Voluntary application of Act:

The following category of establishments can seek voluntary application
of the Employees‘ Provident Funds & Miscellaneous Provisions Act, 1952:-
(i) Any establishment which is not employing 20 persons
(including contract workers); and
(ii) Establishments employing 20 persons but not falling in the

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list of notified industries/class of establishments.
Chapter II
EXEMPTION
On application of the Provident Fund Act to an establishment, the employer may seek
exemption from the operation of Provident Fund Scheme or Pension Scheme or Employees‘
Deposit Linked Insurance Scheme or from all.
The basic condition is that majority of employees should opt for the exemption and the
benefits of the private Provident Fund/Pension Scheme should necessarily be at par or more
than the Statutory Schemes. For exemption from EDLI Scheme, the insurance benefits
payable to the employees should be more favourable than the Statutory Scheme. On grant of
exemption, the Board of Trustees constituted by the Employer shall handle the Provident Fund
matter relating to investment, maintenance of account and settlement of Provident Fund accounts
etc. to the members – such establishments are known as exempted establishments. The
exempted establishments should maintain their own Provident Fund recognized by Income Tax.
The rate and manner of crediting interest should not be less than the one declared for the
members of the unexempted establishments.
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Chapter III
1. BASIC FACTS WE SHOULD KNOW ABOUT ‘PROVIDENT FUND’
Provident Fund
 Provident Fund is a Social Security Benefit to employees.

 It is a compulsory saving by an employee during his employment.
 It is meant for old age.
 This is required to be availed on retirement from service.
 An employee who contributes to Provident Fund is also eligible to receive a
matching contribution from his employer.
Employees’ Provident Fund Act/Scheme
 Employees‘ Provident Fund is set up under the Central Act viz. Employees‘
Provident Funds & Miscellaneous Provisions Act, 1952, in the year 1952.
 It is applicable throughout the country (except Jammu & Kashmir).
 It is applicable to almost all establishments falling under the industries/class
of establishments, wherein 20 persons are employed.
 In the case of cinema theatres workers, it is applicable to such establishments
wherein 5 persons are employed.
 Benefits to an employee are provided through the schemes framed under the
‗Act‘.
 Provident Fund benefits are provided under the Employees‘ Provident Funds
Scheme, 1952.
 Pension benefits are provided under the Employees‘ Pension Scheme, 1995.
 Insurance Benefits are provided under the Employees‘ Deposit Linked Insurance
Scheme, 1976.
 A member of Employees‘ Provident Fund is automatically eligible for Pension and
Insurance benefits without paying any additional amount of contribution.
Employees’ Provident Fund Organisation(EPFO)
 Employees‘ Provident Fund Organisation is administering the above Schemes.

 Employees‘ Provident Fund Organisation is a statutory body under the Ministry of
Labour, Government of India.
 It is an all India Organisation having its offices in all State Capitals, Cities, Towns
and Districts.
 The Employees‘ Provident Fund is administered by Central Board of Trustees –
Employees‘ Provident Fund.
 The Central Board of Trustees, Employees‘ Provident Fund consist of
representatives from Employees‘ Association, Employers Association and
Central/State Governments.
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 Honorable Minister for Labour, Government of India is the Chairman of Central

Board of Trustees, Employees‘ Provident Funds.
 The Chief executive of the Organisation is the Central Provident Fund
Commissioner, New Delhi.
 The Regional Provident Fund Commissioners are in charge of the Regional/Sub-
Regional/Sub-Accounts offices and monitor the compliance from all the
establishments.
 Regional Provident Fund Commissioners are maintaining the Provident Fund
accounts and ensure collection of dues from employers and extending of various
benefits to the Employees/Family members/Nominees.
Special Features of the Act/Schemes
 Employees‘ Provident Fund as also Provident Fund of exempted establishments is

a recognized Provident Fund under the Indian Income Tax Act, 1961.
 An employee is eligible to avail the rebate on Income Tax on his Provident Fund
Contributions subject to ceiling prescribed under the Income Tax Act.
 Non-payment of Employees‘ Provident Fund dues by an employer may lead to
recovery action by Regional Provident Fund Commissioners such as Prosecution,
attachment of Bank Account/Property, arrest and detention etc.
 Non-payment of employees‘ contributions recovered from the wages of the
employees would constitute ‗Criminal breach of trust‘ punishable under Section
406/409 IPC.
 Employees‘ Provident Fund dues paid after the due date (15th of the following
month) will result in payment of interest u/s 7Q & penal damages u/s 14B by the
employer.
 Employees‘ Provident Fund account of an employee can be transferred to any
place in the country. However, with the recent allotment of Universal Account
Numbers to the employees by the Organisation, the need of transfer of funds will
not be required in the near future. However, presently the transfer claims have to
be filed online through the OTCP portal of EPFO.
 Employees‘ Provident Fund may be withdrawn partially for certain specified
purposes such as housing, marriage, illness, etc.
 All Provident Fund Claims of the member are to be disposed by EPF Offices within
30 days.
 Members are given the benefit of filing Nomination for Provident Fund/Pension
and Employees‘ Deposit Linked Insurance.
 The annual Employees‘ Provident Fund balance is informed to every employee by
the Employees‘ Provident Fund Office. With the advent of online compliances,
annual account slips in Form 23 are now being issued online on the employer‘s
portal.
2. WHO IS ELIGIBLE TO BECOME A PF MEMBER?
All employees, employed in an establishment (includes employees employed

through contractors, daily rated, piece rated, temporary, casual etc.).
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―Excluded employees‖ need not be enrolled as PF members.
Excluded employees are –

a) Employee drawing the wages (Basic + DA + Cash value of food
concession) above Rs.15000/- as on the date of joining the
establishment. (If the ‗wages‘ of an employee is increased beyond
Rs.15000 during the course of employment and after becoming a
member of Employees‘ Provident Fund, such employees are not to be
treated as excluded employees. In such cases his contribution may be
restricted to his wages upto Rs.15000/-.
b) Employees whose Employees‘ Provident Fund Accounts were once fully

settled after attaining 55 years of Age or on permanent
settlement abroad.
3. RIGHTS OF EMPLOYEES
Employees drawing wages above Rs.15000/- can also become a member of the
Fund, if the employer and employee give a ‗joint declaration‘ to the Regional
Provident Fund Commissioner.
An employee at the time of joining an establishment should declare his previous Provident
Fund Account Number/membership details to his present employer for communication to
the Commissioner.
All employees should be enrolled as a Provident Fund member from the date of joining
the establishment/factory.
An employee who is enrolled as a member of Provident Fund is automatically eligible

for the membership under the Employees‘ Pension scheme, 1995 and Employees‘ Deposit
Linked Insurance Scheme, 1976.
In case an employee had attained the age of 58 or is in receipt of pension under

Employees‘ Pension Scheme, 1995, he is entitled to become a member of Provident Fund
only and not eligible to join the Pension Fund.
A member of Employees‘ Provident Fund will retain his membership even after his leaving
from employment until his account is fully settled. He can avail the advance/withdrawal during
the period he is out of employment. The benefit under EDLI Scheme is admissible only
where the member died while in service.
A Provident Fund member who withdraws his Provident Fund dues and thus cease his
membership under Provident Fund can continue his membership under Employees‘ Pension
Scheme, 1995, for availing the pension benefit.
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When a PF member leaves one establishment and joins another establishment his PF
account can be transferred to his new employer with a new account number. However,
now the department has recently issued Universal Account Numbers to all subscribers and
also developed an online process in which all any employee joining another establishment
have to provide the Universal Account Number to his existing/ new employer. The Universal
Account Number will be permanent and linked to the PF account number of the member. In
such case the need for transfer of Provident Fund accumulations shall not be required.
A person who joins an establishment, wherein the EPF Scheme 1952 is already in force,
should be enrolled as a member of PF, Pension and Insurance Schemes, from the date of
his joining the establishment.
4. BENEFITS TO MEMBERS
BENEFITS UNDER EMPLOYEES’ PROVIDENT FUNDS SCHEME, 1952.
 Every employee is required to pay Contribution to the provident fund @

12%/10% of the Basic Wages, Dearness Allowance and cash value of food
concession.
 The Employer will also pay an equal amount of contribution.
 While contributing to Employees‘ Provident Funds, the member is eligible
for deductions u/s 80C of the Income Tax Act‘ 1961
 The Provident Fund accumulations of the member will earn compound interest,
calculated on monthly running balances.
 The members are informed of the balance of their Provident Fund accumulation
every year through the Annual Statement of Accounts (Form 23). This facility is
now converted to online issue of Form 23 on the employer‘s portal. With the
advent of new regime with allotment of Universal Account Numbers to each and
every employee/member of the fund, the department is in the process of sending
automated monthly balances over SMS to the registered mobile number of the
members.
 The Provident Fund members can avail advances / partial withdrawals for
Housing, Marriage, Illness, etc., through application in Form 31 which provides
details and documents to be submitted.
 On retirement or on leaving service, the Provident Fund accumulations can be
withdrawn in full by submitting application in Form 19.
 In case of premature death, the Provident Fund is payable to Nominee(s)/ family
members by submission of Form 20 by each beneficiary.
 A member of Provident Fund also acquires membership under pension scheme.
BENEFITS OF PENSION SCHEME
 Pension is a boon for the working class. It is no more the prerogative of

Government employees only.
 An Employee is eligible for Pension after a minimum of 10 years of pensionable
service.
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 The Pension is payable on attaining the age of 58 years, whether he is in service

or superannuated.
 Early Pension at reduced rate can be availed on leaving the employment, after
attaining the age of 50 years.
 Where an employee is totally disabled and leaving service on account of
disablement, Disablement Pension is allowed. There is no age and service
stipulation to claim the pension in such cases.
 Pension is based on age, wage and service of an employee at the time of his
leaving service.
 The payment of Pension is guaranteed and assured even in cases where the
employer fails to deposit the pension contributions.
 When a member dies as Bachelor or Spinster or where there is no spouse or
children below 25 years, the Family Pension is payable to Nominee till his/her
death.
 When there is no valid nomination, the Family Pension is payable to dependent
father followed by dependent mother. However, in case of deceased parents,
pension will be payable to the legal successor as identified by the claimant and
seconded by the Employer through submission of Family Particulars Report.
 In addition to Family Pension to Widow / Widower, Children below 25 years are
also eligible for Pension simultaneously. It is payable to the married daughters
also, below the age of 25 years.
 On behalf of the minor children the pension is payable to guardian as custodian.
 Any child in a family with total and permanent disablement will receive Children
Pension till death.
 The monthly pension is payable through designated Banks and Post Offices on the
first day of every month through the Savings Bank account of the pensioner.
 The pension can be drawn anywhere in India.
 The employees with less than 10 years of service on the day of superannuation
may avail the benefit of withdrawal from Pension Fund.
 Where an employee has not served for 10 years on the date of leaving service
and has not attained the age of 58 years, he may obtain a Scheme Certificate so
as to continue his membership during un-employment period and the same can be
used to count the previous service as and when he joins another establishment
covered under the Act.
The Pension quantum is determined separately for the period of service

from 1.3.1971 to 15.11.1995 as fixed amount. This is known as ―Past Service‖
benefit.
The Pension for the service rendered on or after 16.11.1995 is calculated

through formula namely,
Pensionable Salary x Pensionable Service

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70
An employee on his superannuation is entitled for Pension (through the above

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formula) upto 60% of the pensionable salary. (Pensionable Salary would mean,
the salary drawn by the employee for a period of 12 months prior to the
date of superannuation).
Benefits under Employees’ Deposit Linked Insurance Scheme, 1976
 A member of Provident Fund is also a member of Employees Deposit Linked

Insurance Scheme.
 In case of death of an employee, while in service, insurance benefit upto
Rs.1.00,000/- is payable to the Nominee / family members.
 No contribution is required to be paid by the employee for the insurance benefit.
The employer alone is required to pay the contribution.
5. PAYMENT OF CONTRIBUTION
(1) The Rate of contributions payable under the three Schemes are as under:-
Contribution is calculated on the Basic Pay, Dearness Allowance including cash value of
food concession and retaining allowances, if any, payable to each member.
Scheme Employees’ share Employers’ share
3.67 %
Employees‘
(amount in excess of
Provident Fund 12 % *
8.33%)
Scheme, 1952
(i.e 12%* - 8.33%)
8.33 %
(No separate recovery.
Employees‘ Pension
NIL Diverted from & out of
Scheme,1995
Provident Fund Contributions
only)
Employees‘
Deposit Linked
NIL 0.5%
Insurance
Scheme,1976
* 10 % In case of certain establishments (Jute, Beedi, Bricks, Coir industry, Gaur gum industries)
and also to any establishment which employs less than 20 persons.
(2) The employee‘s share of Provident Fund contribution may be deducted by

Employer from the wages of the member before disbursement. However, such deduction
should be made only from the wages for which the contribution pertains. For example, the
employee‘s share of contribution for June2013 should be deducted only from the wages
for June 2013.
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(3) A member is required to contribute compulsorily upto Rs.15,000/- of his wages and he
may voluntarily opt to contribute beyond the wage ceiling of Rs.15,000/- (i.e. upto his
‗wages‘). In such cases, an employer is not required to pay his own share of contribution
above the wage ceiling of Rs.15,000/-. During the course of membership, if the ‗wages‘
(Basic + Dearness Allowance including cash value of food concession and Retaining
allowances) has crossed Rs.15000/-, the member and employer are required to
pay Provident Fund Contribution upto Rs.15000/- only. In such cases the member
cannot be treated as ―excluded employee‖.
(4) There is no separate contribution payable to the Pension Fund. The contribution towards
Pension Fund is diverted from the employer‘s share of EPF contribution at the rate of
8.33% of the wages.
(5) An employee need not contribute under EDLI Scheme, 1976. The employer alone is
required to pay the contribution.
(6) The Provident Fund contribution of contract employees and the matching contribution
representing the employers share is to be payable by the contractor to the principal
employer, every month.
6. PROVIDENT FUND ADVANCES/WITHDRAWALS
A member of the EPF can avail the advance/withdrawal during the period of his
membership, whether in employment or not, for the following purposes:-
 For financing Insurance policy,

 For Housing (purchase of site, house, flat, and construction, addition/alteration
of house and repayment of housing loans).
 Financial assistance- on dismissal, discharge, retrenchment and closure/lock out.
 For illness of the member/family member.
 For marriage and post matriculation education.
 To meet the loss of property due to natural calamity.
 Loss in wages due to power-cut.
 Purchase of Equipment for physically handicapped.
 To withdraw the Provident Fund one year before retirement.
How to avail Provident Fund advances?

The Employees Provident Fund is a Social Security scheme mainly meant for the
post retirement period of the working class. Though it is the main objective, it
also provides for withdrawing their Provident Fund money to meet out certain
contingencies.
The Provisions envisaged under paragraphs 62 to 68-O of the EPF Scheme

regulates the withdrawals/advances that a member can avail of himself during
his period of membership.
There is a common application form for all the advances i.e. Form-31 except for
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withdrawal under Para 62 for financing Life Insurance Policies.
7. HOW TO WITHDRAW PF AND OTHER BENEFITS?
On leaving an employment:
A member of EPF on his leaving employment on resignation etc., if he is not
securing any employment in a PF covered establishment, may claim his PF
accumulations by himself. For this purpose, the member is required to submit the
prescribed application in Form 19. This form is required to be filled in and given
to the member by the employer on the date of his leaving the service. This form
is required to be submitted to the Regional Provident Fund Commissioner after
completion of 2 months from the date of leaving service. In case, the member
secures another employment before submitting his application the account is
required to be transferred.
On death of a member:
On death of a member, the Provident Fund amount is payable
immediately to the nominee/s.
If there is no valid nomination the Provident Fund amount is payable equally to

all the eligible members of his family.
If both nominee and ‗family‘ members are not applicable the legal heir is eligible
to claim the Provident Fund dues of the deceased member.
In such cases the claim is to be preferred by the eligible person through

Form 20. The claim should be forwarded only through the employer. In case of
closure of establishment the claim may be sent through the authorised persons as
per the list given in the application form. It is desirable that in such cases
the claim may be attested by the bank manager wherein the bank account is
kept.
In case if any employer refuses to attest and forward the application the fact
may be conveyed to the Regional PF Commissioner/Grievance Officer/PRO
and further guidance may be obtained.
Who can claim the benefits under the Employees’ Pension Scheme, 1995?
A member of Employees‘ Provident Fund acquires membership under Pension

Scheme also.
A Provident Fund member who is eligible to withdraw his Employees‘ Provident

Fund dues can therefore avail the benefit due under the Pension Scheme also. It
is not necessary to avail the pension benefit alongwith Provident Fund. A member
can avail his Provident Fund dues only and retain his membership under the Pension
scheme. However, a member who had attained the age of 58 years can avail
the benefit under the pension scheme. Because, a member cannot retain his
pension membership after the age of 58.
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A member of the Pension Scheme is eligible for the following benefits:-

(i) Withdrawal benefit
(ii) Scheme Certificate
(iii) Monthly Pension.
On death of an employee, while in service, the family (spouse and children) is

eligible to receive monthly family pension i.e. for the widow/widower and
also to children (below 25 years).
Thus the benefits under Pension Scheme can be claimed as under:

It may be noted that the benefits under Pension Scheme are not at all
related to the contribution paid, on behalf of the member. It is
calculated with reference to the age, wage and service of the member.
Thus, the factors viz. Age and service determines the eligibility for a
particular type of benefit, whereas the ‗wage‘ factor enables the
determination of quantum of benefit for monthly pension. Before applying
for the benefit under Pension Scheme, the member has to verify his age as
given to the Employees‘ Provident Fund Office and his period of service.
He may fall under any one of the following category to receive the
benefit mentioned against each:-
Categor Service Age Nature of benefit eligible
y (2) (3) (4)
(1) Issue of Scheme Certificate. Or
1 Below 10 years Below 58 years Payment of withdrawal benefit
(at the option of member)
2 Below 10 years Attained 58 Only Withdrawal Benefit
10 years years
3 Below 58 years Only Scheme Certificate
and above
Attained 58
10 years years (whether
4 continued in Monthly Pension to Member
and above
service or
retired) Eligible for Scheme Certificate
10 yearsand
Completed 50 Or
5 above(Not in
years of age For Reduced(early) Monthly
employment)
Pension.
Total and
permanent
6 Below 58 years Disabled Pension to member
disablement while
in service
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On Death of a member
Category Occurrence Service Age Benefit
of death
1 Death while Paid at least Below 58 Monthly Pension to the
in service one months‘ years on the Family (spouse and
contribution date of death children).
for the Where no eligible family
service (spouse and children below
rendered 25 years), Family Pension
during to Nominee for life.
a Where no family or no
month nominee, Family Pension to
Dependent parents. /-.
2 Death after 10 years Below 58 Monthly Pension to the

leaving the years of age Family (spouse and
service (where children).
the Where no eligible family
membership is (spouse and children below
retained) 25 years), Family Pension
to Nominee for life.
Where no family or no
nominee, Family Pension to
Dependent parents.
3 Death after Below 10 Below 58 Family Pension to

leaving the years years of age widow/widower/children. If
service (where there is no
the family member,
membership is one time benefit of
retained) Return of Capital is
payable to Nominee or
Dependent Parents.
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4 Death while Not relevant Not relevant Family Pension to only

receiving spouse and children (below
Pension 25 years) (nominee and
Dependent parents are not
eligible)
Claiming Withdrawal Benefit:-

A member who is eligible to draw the withdrawal benefit is required to submit
the application in Form 10C, through the employer.
In case a member who has not rendered 10 years service, he is eligible to

avail the withdrawal benefit or he may avail the Scheme Certificate, at his
option. The option should be indicated in the application form.
Claiming of Scheme Certificate
A member who is required to avail the Scheme Certificate compulsorily (when the
service is 10 years and above) and the option for Scheme Certificate should be
specifically mentioned in the application form. Those who opt for Scheme
Certificate instead of Withdrawal Benefit are required to submit the application
in Form 10C, through the Employer.
The Scheme Certificate received from the Regional Provident Fund

Commissioner should be preserved carefully. It should be submitted to the employer,
if the member seeks employment before the age of 58 years. In case of death
of the Member, the family can surrender the Scheme Certificate and avail the
Family Pension, as admissible under the Pension Scheme.
Claiming of Pension.
A member or the beneficiary can claim Pension through an application in Form

10D in the following cases.
1. On total and permanent incapacity (100% disablement) (without any
restriction of service period).
2. On attaining the age of 58 years with eligible service of 10
years.
3. After rendering 10 years service and on leaving the service
between 50-57 years. (Reduced Pension can be opted).
4. In case of death of a member while in service or away from service,
the eligible family Members/ nominee/ Dependant parents for
availing family pension.
5. The Form 10D should be forwarded only through the employer
(except in the case of closed establishment) alongwith the documents
mentioned. The age of the children should be supported by the school
certificate or any valid document.
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6. To claim the family pension, the widow/widower may submit only

one application on his/her behalf and on behalf of two children.
Pension once sanctioned will automatically be passed on to all the
eligible beneficiaries, as indicated in the Pension Payment Order.
Assurance benefit under Employees’ Deposit Linked Insurance

Assurance benefit under EDLI scheme is payable only in the case of death of an
employee-member while in service. The person(s) who are eligible to Provident Fund
benefits are entitled to receive the EDLI benefits.
Benefits under the Employees’ Deposit Linked Insurance Scheme

The amount of assurance benefit payable is an amount equal to 20 times of the
average balance in the account of the deceased in the Fund during the
preceding 12 months or during the period of his membership whichever is less,
Plus a bonus of 20%. subject to a maximum of Rs. 6,00,000/. The form
prescribed for claiming the Assurance benefit under EDLI Scheme, 1976 is Form
5(IF).
8. TRANSFER OF PROVIDENT FUND ACCOUNTS
SCHEME
S.No. FORM No. PURPOSE
PROVISIONS
Form 13
Section17-A
(Revised)- Application for seeking transfer of account by a
1. of the Act/ Para 57
Online through member.
of EPFS, 52
OTCP EPFO
A Provident Fund member, on leaving an establishment and joining another

establishment (Whether the Act is applicable or not) can seek transfer of his Provident
Fund balances to his new Provident Fund account opened in the transferee establishment.
This application should be submitted through the present employer to the Regional
Provident Fund Commissioner concerned for effecting the transfer. The member
should also ensure that the amount transferred to his present account number is
included in the Provident Fund Annual Statement of account of the year in which
transfer was effected.
(Refer to further discussion on Universal Account Number to understand the recent change in
transfer procedures)
UAN stands for Universal Account Number to be allotted by EPFO. The UAN will act as an
umbrella for the multiple Member Ids allotted to an individual by different establishments.
The idea is to link multiple Member Identification Numbers (Member Id) allotted to a single
member under single Universal Account Number. This will help the member to view details of
all the Member Identification Numbers (Member Id) linked to it. If a member is already
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allotted Universal Account Number (UAN) then he / she is required to provide the same on
joining new establishment to enable the employer to in-turn mark the new allotted Member
Identification Number (Member Id) to the already allotted Universal Identification Number
(UAN)
10. IMPORTANCE OF NOMINATION FORM
Every employee who joins the EPF Scheme is required to furnish a declaration
and Nomination Form in the prescribed Form No.2 (Revised) to his employer for onward
transmission to the Regional Provident Fund Commissioner concerned. This nomination form
enables the member to give details of his nominee for Provident Fund and list of family
members and nominee for Pension Scheme. There is no separate nomination form for EDLI
Scheme as the PF beneficiary is eligible to receive the EDLI benefit.
The nomination is considered as a very vital document for each PF member

because in case of death of a Provident Fund member, the Provident Fund balances are
payable to the nominee in the first instance. Only in case there is no valid eligible
nominee, it is distributed to the family members in equal shares. In the absence of
nominee as well as eligible family members, the amount will be distributed to the
legally entitled persons.
Nominee for Provident Fund:

A member having a ‗Family‘ viz. wife/husband, children and dependent parents
(according to the definition of family) is required to nominate one or more
persons belonging to his family only. If the member has no family members,
he can nominate any person/s; but if the member acquires a family, such nomination
is deemed as invalid. The member should make a fresh nomination.
Nominee For Pension
In the case of nomination for pension it may be noted that the family pension is
automatically payable to the family (i.e.) Widow or Widower along with two
children (below 25 years). As such, as long as the family members survive as on
the date of death of the member the pension is payable to them only and the
nomination will have no effect.
Where there is no eligible family member (i.e.) Widow or Widower and Children
below 25 years, as on the date of death of a member then the family pension is
payable to the nominee as given in Form 2. Hence, it is necessary to file a
nomination. The nominee should be from the ‗family‘ i.e. the nominee for Pension
need not be the spouse, as he/she is an automatic beneficiary. Hence, any child
(below 25 years) should be nominated for Pension. The nomination for pension
should be in favour of one person only.
12 . SUPPLY OF ANNUAL PF STATEMENT OF ACCOUNTS

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The Regional Provident Fund Commissioner sends the individual members EPF
Annual Statement of Accounts Slips pertaining to every Financial year (in
Form-23) to the employer before 30th of September of the following year for
delivery to every EPF member of the Establishment. The same in now being issued
online on the employer‘s portal.
The Employer should distribute the same to the respective members. Members
should satisfy themselves to the correctness of the details indicated in Form-23
slips and any error should be brought to the notice of the Commissioner through the
Employer.
The Provident Fund Annual Statement of Account will reflect the Provident
Fund balances only. It does not indicate the contributions paid towards Pension
Fund There is no separate Statement of Account issued under the Pension Scheme.
It is on account of the fact that the Pension payment is not based on the
quantum of contribution paid on behalf of the member. It relates with reference
to age, wage and service of the member. In view of the above, the Provident
Fund Annual Statement of Account will reflect only the EPF contributions recovered
at the rate of 12% or 10% of wages under employee‘s share in full and
3.67%/1.67% of wages under the employer‘s share (i.e. 12% - 8.33% diverted
to Pension Fund).
Chapter IV
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WHAT EMPLOYERS SHOULD KNOW
1. ROLE OF THE EMPLOYER
- All employees including contract employees are to be enrolled as Provident Fund members
from the date of their joining your establishment.
- Forward the details of employees enrolled as Provident Fund members before 15th of
every month to the Regional Provident Fund Commissioner through Form – 5.
- Obtain the Nomination in Form – 2(R) from the member and forward it alongwith Form 5.
- Pay the Provident Fund / Pension / Insurance Fund contributions and Administrative
charges before 15th of each month so as to avoid payment of interest & penal
damages on belated deposit and to prevent action of prosecution, imprisonment, sale
of movable / immovable property, attachment of Bank Account etc.,
- In the case of resignation of an employee, the Provident Fund is payable after 2 months. In
such cases, the Form 19 is to be completed duly attested by the employer or
authorized officer and deliver it to the employee on the day of his leaving the
service. The employee may submit to Regional Provident Fund Commissioner after 2 months,
if he is not securing employment.
- Distribute the Provident Fund Annual Statement of Accounts in Form – 23 to all members
immediately on its receipt from the Regional Provident Fund Commissioner.
2. DEFAULT IN PAYMENT OF DUES BY EMPLOYER – CONSEQUENCES:
o Penal Damages upto 37 % per annum and interest at the rate of 12 %

payable on defaulted deposits.
o Attachment of Bank Accounts.
o Realisation of dues from Debtors.
o Attachment of movable and immovable properties.
o Arrest and Detention.
o Action under Section 406 / 409 of Indian Penal Code.
o Action under Section 110 Criminal Procedure Code.
o Prosecution under Section 14 of the EPF & MP Act 1952.
FREQUENTLY ASKED QUESTIONS

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EPF MEMBERSHIP
1. I am an employee working in an establishment to which the PF Act is not applicable. Can I

become a member of the EPF?
An employee can become a member only after the application of the Act to the establishment.
2. If an employee is not given membership under Employees‘ Provident Fund, to whom he can
approach?
He can approach his employer failing which he can approach the Regional Provident Fund
Commissioner.
3. Whether the employees working in a Branch Unit of an establishment located outside the state
is eligible to become a member of the EPF?
The Act is applicable to an establishment, its employees, irrespective of their place of work or
location.
4. Can an employee become a member of EPF without any age restriction?
There is no age restriction for becoming a member of the Provident Fund, whereas an
employee who has already attained the age of 58 cannot become a member of the Pension
Fund.
5. Whether an employee can become a member of the EPF without any restriction to his
salary/wages?
An employee who draws basic wages and dearness allowance (and cash value of food
concession) upto Rs.15000/- is alone eligible to become a member. He will continue to be a
member even when his pay exceeds Rs.15000/-. However, his contribution to the Fund can be
restricted to Rs.15000/-. The employer is also required to pay his matching contribution upto
Rs.15000/-.
6. If an employee is drawing more than Rs.15000/- (Basic + DA only) is he required to become

a member of the EPF?
Such an employee is not required to become a member, if he is not already holding the PF
membership. Otherwise, if both the employer and employee are willing, he can become a member
by giving option.
7. If an employee is transferred from one establishment to another establishment whether

he is required to be enrolled as a member once again?
He is required to be enrolled as a member under the new establishment, for transferring his
Provident Fund from his previous account to his new account.
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8. If a person is working in an establishment without receiving any wages whether he can be

given the PF membership?
Membership is allowed only where the wages are payable to an employee.
9. Whether an employee can become a member of the Pension Scheme only, without contributing
to the PF?
No. By virtue of membership of Provident Fund only one can become a member of the Pension
Scheme.
10. Whether an employee can continue as a PF member even after his retirement?
Yes.
11. Is there any option available to an employee whether to become a member of the EPF or not?
No.
12. Whether a EPF member can discontinue his membership, while in employment?
No.
13. Where an establishment is having its own recognised private PF whether an employee can be
allowed to continue in the private PF without joining the EPF?
If the Act is applicable to that establishment, then he should seek exemption from the EPF Scheme.
He will however continue to be governed by the Pension and EDLI Schemes.
14. How the period of non employment between two spells of employment is treated under EPF?
Non employment period is not affecting the EPF but affects the service for the purpose of
Pension.
15. What will happen to the EPF membership of an employee during the period of closure, lock-
out, strike etc.?
During such period the membership will continue and in the absence of wages no recovery
of contribution will be made.
16. Whether an employer can also join the PF?
No.
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17. Whether any employee can join the EPF directly?
No.
18. A Security Guard is working for different establishment; under whom he is required to secure
membership?
If the employer/recruitment agency of the Security Guard has been brought under the Act, the
membership will be given through him, irrespective of his place of work.
19. If the establishment is not employing 20 persons, whether an employee can join the EPF?
Yes. The majority of employees and the employer can voluntarily opt for the Act/Schemes
through their employer.
20. Whether an employee drawing Pension under EPS, 1995 is required to join the PF and
Pension Fund?
He is required to join only the PF and not to the Pension Scheme.
21. An employee who joins an establishment at the age of 58 is eligible to become a member of
the Pension Fund?
No.
22. How long a member can retain his Provident Fund in his account?
The membership can be retained till the withdrawal of his Provident Fund dues.
23. Whether an employer can deduct employer‘s share of contribution from the wages of
employees?
No. It is not permissible.
24. Can the wages be reduced by the employer on account of payment to the EPF?
No. It is not permissible.
25. Whether a daily rated employee or the piece rated employee can become a member
of the EPF?
Yes. Irrespective of the nature of employment.
26. If an employee is paid wages on daily basis or on piece rate basis how the contribution is
determined?
The wages paid in a month will be taken to determine the contribution due.
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27. Whether the member is entitled for full interest on the belated deposit of PF dues by the
employer?
After realising the dues, the PF members will be given full interest for each due month and it
will no way affect the interest due to members on the contributions paid.
28. An employee is paid subsistence allowance during the period of his suspension. Whether PF
contribution is payable on this?
Yes.
29. Can an employee contribute to the EPF after leaving the service?
No. In the absence of wages no recovery can be effected.
30. The contribution has been recovered from the wages of the employee but the employer had
not paid to the EPF. What is the remedy?
The Employees‟ Provident Fund Organisation will invoke penal provisions of the Act to recover
the dues from the employer. In such cases when the employee leaves/retires the question of
payment of employee‟s share will be considered for releasing the amount from the “Special
Reserve Fund”.
31. What will be the effect of non payment of PF dues by an employer? or

How a member is affected for non payment of EPF dues by the employer?
The Provident Fund dues of the member will be paid only to the extent the amount is realised
from the employer.
32. Whether an employer can recover any outstanding dues from the PF amount payable to a
member?
No. It is totally prohibited.
33. What are the measures by which the PF amount is recovered from a defaulting employer?
Attachment of Bank Accounts, Realisation of dues from Debtors, Attachment of properties,

Arrest and Detention, Action under Section 406/409 of Indian Penal Code and Section 110 of
Criminal Procedure Code, Prosecution.
34. How a member is informed about the non payment of contributions recovered from the wages
of the employee but not paid to the EPF?
The Annual P.F. Statement of Account will indicate only the amount paid by the employer. The
default period in a year is thus made known to the members.
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35. Whether the P.F. amount credited to the member can be attached against any liability?
No. The Provident Fund enjoys protection against attachment by Court also.
36. When an employer becomes insolvent or when a company is wound up, whether the
contributions will be paid in priority over other debts?
Yes.
37. In the case of non payment of PF dues by the employer, how the P.F. members are paid their
dues?
The members‟ share alone is payable from the Special Reserve Fund. In case the establishment is
closed for more than five years or it is under liquidation the question of paying the employer‟s
share will also be considered from the Special Reserve Fund.
38. Can a member demand for showing the recovery of contributions from the employer?
Yes. The contribution card of each member in Form 3-A can be demanded from the employer.
39. How the contract employees are protected and given their P.F. when the contractor is not
paying the dues to the principal employer?
It is the duty of the principal employer to ensure that the Contractor discharges his
liability.
40. Can a member refuse to part with the payment of contribution to the Pension Fund?
The Pension contribution is only a diversion from the employer‟s share of Provident Fund. Hence
no consent is required from the member and refusal does not arise.
41. Whether an employer can stop paying Employees‘ Provident Fund contribution in respect of a
member who had attained the age of 55 or 60?
No. The Employees‟ Provident Fund Contribution should be paid till the date of his leaving the
service, irrespective of the age of the member.
42. In the absence of nomination, how the P.F. amount of a deceased member is paid?
It is payable to the family members in equal shares, under Para 70 (ii) of EPF Scheme, 1952. If
there is no eligible family member, it is payable to the person(s) who are legally entitled to it.
43. What is the need for giving nomination for pension?
On the death of a Pension member (before receiving the pension), if there is no eligible family
member, pension is payable to the nominee.
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44. Whether the nominee given for pension is applicable for return of capital also?
No. A nominee should be specifically mentioned by the member while applying for his
superannuation/early pension in Form 10D. (The nominee may be the same person as given in
Form-2)
45. Whether the nomination can be changed?
Yes. through Form 2.
46. In the absence of valid nomination to whom the Pension amount is payable?
Payable to the dependant parents, (dependant father followed by dependant mother).
47. Whether a bachelor can nominate any person?
Yes. On acquiring the „Family‟ the nomination is treated as invalid.
48. What are the advantages of taking a Scheme Certificate?
1) It facilitates transfer of Pension Accounts when the employment is

changed.
2) If the Holder of Scheme Certificate dies the family will get family pension.
3) It is like a Policy for Pension without paying the premium.
49. Can a member seek exemption from the Pension Scheme?
Individual member can not seek exemption from the Pension Scheme.
50. At what age a member is eligible for pension?
A member is eligible for pension on superannuation at the age of 58 years. If a member leaves
employment between 50 and 57 years he can avail the early (reduced) pension.
51. What is the service required for giving pension in case of death of the member?
The minimum service of 10 years is only for payment of pension to a member. It is not
applicable, where a member dies. The family pension is payable even after receiving one month‟s
contribution (including part of the month) for Pension Fund.
52. If a member dies to whom the pension is payable?
On death of the member the Pension is automatically payable to the spouse

(Widow/Widower). In addition, the children are also eligible (2 at a time).
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53. What is Universal Account Number?
UAN stands for Universal Account Number to be allotted by EPFO. The UAN will act as an
umbrella for the multiple Member Ids allotted to an individual by different establishments. The idea
is to link multiple Member Identification Numbers (Member Id) allotted to a single member under
single Universal Account Number. This will help the member to view details of all the Member
Identification Numbers (Member Id) linked to it. If a member is already allotted Universal Account
Number (UAN) then he / she is required to provide the same on joining new establishment to
enable the employer to in-turn mark the new allotted Member Identification Number (Member Id)
to the already allotted Universal Identification Number (UAN)
54. Can a pensioner opt for commutation and also return of capital?
Yes. He has to give a specific option for both in the application form.
55. In case the employer has failed to pay the pension contribution whether any pension is
payable or not?
Non payment of pension contribution by an employer will not affect the grant of Pension. Pension
is guaranteed.
56. Can a pensioner get pension anywhere in the country?
Yes.
57. When the minimum 10 years of service is required for giving pension to an employee what is
the service required in case of his death in service?
Even with one month‟s service (included part of the month) family pension is payable, in case of
death in service.
58. When a member avails reduced pension at the age of 50 can he get his full pension on
attaining 58 years?
No. Once Pension is sanctioned it can not be altered.
59. What are the criteria for determining the date of eligibility for early pension? (Before 58)
The member is required to indicate his option regarding the date from which he requires early
pension in the application form.
60. Can a member avail pension even while he is in service?
The member who continues in service even after 58 years can avail the Pension from the age of
58.
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61. Can an employee surrender or sell his full pension for getting a lumpsum payment?
No.
62. Is it compulsory to withdraw the pension benefit alongwith the P.F. amount?
No. A member can withdraw his PF dues but he can continue to be Pension member. In such
cases he can avail the Scheme Certificate.
63. Can a married daughter be excluded from receiving the family pension?
The marital status has no relevance if the children are below 25 years; they are eligible for family
pension.
64. When the member has opted for return of capital to be paid after the death of his spouse,
whether any family pension is payable to the spouse?
Option of Return of Capital is no longer available.
65. If a member is having two wives to whom the family pension is payable?
If the second marriage is legally valid, it is payable to the eldest with reference to the date of
marriage and on her death, payable to the next surviving widow.
66. In the absence of family member whether a pensioner can nominate any other person to
receive family pension?
No. In the absence of family member on the date of the death of the member (before
eligibility for member pension), the family pension is payable to nominee and in the
absence of a valid nomination it is payable to dependant father followed by dependant
mother. Once the pension is received by the member there is no validity for nomination. A
pensioner cannot nominate any person.
67. What will be the effect of unemployment period under the Pension Scheme?
The unemployment period will be excluded from the actual service.
68. Is it possible to exclude the spouse from receiving the family pension?
No. The spouse is an automatic beneficiary unless she is legally divorced.
69. In the absence of family members and also nominee to whom the pension is payable?
It is payable to the dependant parents.
70. Who is eligible for disablement pension?
Any employee (Pension member) irrespective of age and service who is declared as disabled
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with 100% disability certified by the designated Hospital and where the member had left
service only on account of his disablement is eligible for disablement pension.
71. In case the widow or widower remarries, to whom the family pension is payable?
The pension payable to the widow/widower will be stopped and thereafter the children pension
will be converted to orphan pension by giving higher pension.
72. What is the period upto which pension is payable to the widow or widower?
For life.
73. When a member is having children through his first and second wife, how the eligibility for
children pension is determined?
The children of both first and second wife should be arranged in the order of their date of
birth and then the children pension is allowed.
74. Is it necessary to open a separate bank account to draw the children pension?
Yes.
75. Can the widow and children draw pension in different places/banks?
No. The pension should be drawn by widow and children in the same bank and branch.
78. Who is eligible to get a Scheme Certificate?
A member whose service is 10 years or more and not attained the age of 58 years will be
eligible to receive the Scheme Certificate only. A member whose service is less than 10 years
also may avail the Scheme Certificate.
79. Whether a member/family member can avail 2 pensions under Employees‘Pension

Scheme, 1995?
No.
80. When and to whom the pensioner is to give a life and non-remarriage certificate?
All pensioners drawing pension under Employees‟ Pension Scheme, 1995 are required to
give a Life/Non-Remarriage Certificate, duly attested by the Bank Manager/Gazetted
Officer in the month of November each year. To be submitted to the Bank through which
the pension is being paid. Failure to submit will result in stoppage of pension from the month
of January.
81. Whether a Scheme Certificate holder with a service period of 8 years can avail the
withdrawal benefit on surrender of Scheme Certificate.
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No. Only on attaining 58 years he can surrender either to avail the Pension (if eligible) or
withdrawal benefit.
82. Whether the Orphan Children are eligible for double Orphan Pension where both the
parents were making contributions under Employees‘ Pension Scheme, 1995?
Yes. The benefit under the Pension Scheme is a direct consequence of the
contributions paid by the member of EPS, 1995, hence, if both parents were members
and have contributed independently to the said Scheme, the Orphan will be eligible to two
pension separately. The normal ceiling as provided for in the Employees‟ Pension
Scheme shall however, continued to apply.
83. Whether Withdrawal Benefit will be payable to a member in case of defaulting

establishment?
In respect of an establishment defaulting in remitting contribution to the Employees Pension

Fund 1995 for any period, withdrawal benefit will not be paid to the member in
respect of the default period. The member is entitled to withdrawal benefits only in respect of
the period for which the contributions are received.
84. Whether Assurance benefit under EDLI Scheme is payable for death away from service?
No. Admissible only in case of death while in service.
85. To whom the EDLI benefit is payable?
EDLI benefit is payable to the persons eligible to receive the EPF dues.
86. In case the PF amount is not settled within 30 days to whom the matter is to be reported?
He can approach the Regional P.F. Commissioner in charge of Grievances or he can appear
before the Bhavishyanidhi Adalat being conducted on 10th of every month.
87. Is there any time limit for withdrawal of Provident Fund dues?
Only in the case of resignation from service a member has to wait for a period of two months
for withdrawal of the PF dues.
88. When the employer is not attesting the claim form how to submit the application for
withdrawal of provident fund?
It is the duty of the employer to attest the application form. In case of any dispute, the
member may attain attestation preferably from the bank in which he has maintained his
account and thereafter submit the same to Regional PF Commissioner, explaining the
reasons for not obtaining the signature of the employer. The Regional P.F.
Commissioner will pursue the matter with the employer wherever necessary.
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89. What is the time limit fixed for disposal of the application for advances/settlement?
On submission of the claim with full particulars and documents etc, it will be disposed within
30 days.
90. In case of change in employment whether a member can get his PF account transferred?
On change in employment, the member should necessarily get his PF account transferred
to his present establishment, duly submitting Form 13(R ). Presently the transfer procedure
is online through OTCP portal of EPFO.
91. How a PF member will be informed of the transfer effected?
Online status of transfer claims can be checked on the OTCP Portal of EPFO.
92. What is the method of crediting interest to the P.F. subscribers?

The compound interest is credited on monthly running balance basis at the statutory rate
declared for each year.
93. Whether the annual statement of accounts will be issued to the members who are out
of employment?
Yes. Issued till the account is transferred to Unclaimed Deposit; in such cases the
member may approach the Regional P.F. Commissioner concerned for obtaining the
statement of account.
94. Is the P.F. Statement of Accounts is issued only after full payment of dues by the employer
is made for the whole year?
No. The statement is issued to the extent the amount is received in the financial year.
95. Why there is no statement of accounts for pension amount and why the Pension
contributions are not shown/reflected in P.F. Annual Statement of Accounts.
The Annual statement of accounts is issued only for the PF balances. The pension
contributions are credited to the Pension Fund and no running account is kept in respect
of a subscriber because the benefit under Pension Scheme is not related to the quantum
of pension contribution paid. It purely relates to the age, wage and service of the member,
on exit from employment. As such the pension contributions are not required to be reflected in
the PF Annual Statement of Accounts.
96. Whether provident fund provides for any refundable loan for Housing etc.?
No.
97. Whether pension can be paid by money order or cheque?

No. Pension is payable through the designated bank/Post Offices, notified for each region.
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SECTION – 2
EMPLOYEE’S STATE INSURANCE ACT’ 1952
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EMPLOYERS’ GUIDE TO ESI SCHEME
For a country to grow and develop, there should be sustainable and balanced growth of
agricultural and industrial sectors. Thus, industrial sector play a major role in improving the wealth
of a country. In order that industries focus on their core areas, i.e., optimum utilisation of the
available resources and improving the productivity of the factors of production, without worrying
about protecting the workforce from the physical and financial distress arising out of sickness,
maternity, employment injury, etc, the ESI Scheme was devised.
The employers play a major role in the functioning of the Scheme, through registration of it‘s
employees, remittance of contribution and through compliance with the provisions of the Act. This
guide is meant to be a reference booklet for the covered and coverable employers, whose role is
pivotal for the success of the Scheme.
ABOUT THE ESI SCHEME
1. What is ESI Scheme ?

The ESI Scheme is a comprehensive social security scheme devised to protect the employees
covered under the Scheme against financial distress arising out of events of sickness,
maternity, disablement / death due to employment injuries and to provide medical care to
the employees and their families. The Scheme is based on the principle of ‗pooling of risks
and resources‘, wherein that section of the population which is exposed to risks of the same
nature, come together to mitigate the physical and financial distress arising out of such risks.
2. To whom is the Scheme applicable to ?

The Scheme is applicable to only those areas where the Scheme is extended / made
applicable by the State Government by notification. The Scheme applies to all factories,
shops and establishments located in the implemented areas, where ten or more persons are
employed. Thus, the Scheme is applicable to all factories, shops, hotels, restaurants, cinema
theatres, offices, medical institutions, educational institutions, etc. subject that:
i) The employer is located in an area to which the Scheme is extended to by the
State Government, and
ii) Ten or more persons are employed
The Scheme is NOT applicable to :

a) Seasonal factories exclusively engaged in one or more of the following manufacturing
processes, viz., cotton ginning, cotton or jute pressing, decortication of ground-nuts, the
manufacture of coffee, indigo, lac, rubber, sugar (including gur) or tea or any
manufacturing process which is incidental to or connected with any of the aforesaid
processes
b) Mines, subject to the operation of the Mines Act.
3. Which of the employees are eligible to avail benefits under the Scheme/
All employees of a covered unit, whose monthly remuneration (excluding overtime) does not
exceed Rs.15,000/- per month, are eligible to avail benefits under the Scheme.
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4. Who is responsible for the administration of the Scheme ?

The Scheme is administered by the Employees State Insurance Corporation, set up under the
ESI Act, 1948. The Corporation (similar to Board of Governors) the comprises of
representatives of the employers, employees, the Central Government, State Governments,
eminent medical professionals and that of the Parliament. Besides the Corporation, there is a
Medical Benefit Council which advises the Corporation on matters related to the extension of
medical care to the beneficiaries of the Scheme.
The Director-General is the Chief Executive of the Corporation is the ex-officio member of
the Corporation. At the state level, Regional boards have been constituted and at the grass-
root level, Local Committees have been constituted for the smooth functioning of the Scheme.
The Regional Boards and Local Committees comprise of representatives of employers and
employees of the respective jurisdiction, so as to cater to the local and varied needs of the
employers / employees.
The Corporation has its headquarters at New Delhi, besides regional offices / sub regional
offices in the states and over 800 local offices throughout the country. While the
administration of the Scheme, including coverage, collection of contribution, disbursement of
cash benefits, etc. are under the Corporation, the extension of medical care is administered
by the respective State Governments on a cost sharing basis.
5. How is the Scheme financed ?

The Scheme is funded by the contributions raised from the employees and employers of the
covered employers. The rates of contribution, as a percentage of wages paid / payable to
the employees, are as under:
Employees‘ contribution – 1.75% of the Wages.

Employers‘ contribution – 4.75% of the wages.
Thus, in respect of each of the employee, 6.50% of the wages (including overtime allowance)
is to be paid as contribution to Scheme. The Scheme does not receive any budgetary
support from the Government. The State governments, as per the provisions of the Act,
contribute 12.5% of expenditure on medical care on ESI beneficiaries in their respective
States within the per capita ceiling.
6. What benefits do the employers avail under the Scheme ?

The various benefits that the employers reap out of the Scheme are:
a) No expenditure to be incurred towards administration of medical care to the
employees / their dependants.
b) No requirement for medical insurance policy as all medical facilities, including Super
specialty treatment is extended to the beneficiaries, without any ceiling on expenses.
c) Employers are exempted from the provisions of / liabilities under:
i) Maternity Benefit Act
ii) Employees‘ Compensation Act
7. What are the benefits that the employees get out of this Scheme ?
The benefits available under the Scheme to the employees can be categorised under two
broad heads, viz., cash benefits and non-cash benefit, viz., medical care.
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Cash Benefits:
1. Sickness benefit – for employees during the period of sickness
2. Maternity benefit – for employees during the period of confinement
3. Disablement benefit:
a) Temporary disablement benefit: for employees arising out of employment injury
b) Permanent disablement benefit: for employees arising out of employment injury
4. Dependants’ benefit – for dependants of employees; in case of death of employee
due to employment injury
5. Other benefits:
a) Funeral Expenses – to a person who performs the last rites of the deceased
employee
b) Rehabilitation allowance – for employee who is disabled due to employment
injury
c) Vocational rehabilitation - for employee who is disabled due to employment
injury
d) Medical Bonus – for insured woman / wife of employee during confinement
Medical Care:
Employees and their dependants are administered medical care, through ESI dispensaries,
hospitals, etc.; in case the requisite facilities are not available in the ESI hospitals, the employees
are referred to premier private / government hospitals for medical treatment on ‗cashless’ basis.
The employees / dependants of the employees are also entitled for super specialty treatment,
without any ceiling on the cost of medical treatment.
Old age medical care: For retired employee and spouse on payment of Rs.120 per year; the
beneficiaries are entitled to all medical facilities available in ESI hospitals (not eligible for referral
to & treatment at tie-up hospitals).
REGISTRATION, CONTRIBUTION AND ALLIED PROVISIONS
8. How should an employer register as per the provisions of the ESI Act?
Any employer who becomes coverable under the Act can register online ( www.esic.in) and get
registered. While registering online, the employer has to give correct and complete details. (the
employer would be contacted through the email for communicating the access credentials to the
employer portal, reset of password, etc.); once registered, the employer will be allotted a 17
digit employer code. Except for employers who supply manpower, all the employers can
proceed with the compliance under the Act, without even visiting the ESI offices, as all activities,
like registering the employees employed, filing contribution, generating challan for remitting
contribution, filing periodical returns, etc. can be done online.
9. Should an employer who has operations all over the country, register only once where it‘s head
office is located, or should it get registered separately for each of it‘s branch offices also?
An employer who is already registered under the ESI Act (who is having a 17 digit code) need
not apply for registration afresh in respect of its branch offices located in different locations of
the country. Instead, the employer can get a sub-code generated in respect of it‘s branch offices
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(can be generated online) so as to comply with the provisions of the Act. Sub-codes need to be
generated only in respect of offices located outside the jurisdiction of the Regional Office / Sub-
regional office in which the main office is located. In other words, if the branch office is located
in the same state in which the main office is also located, a separate sub-code need not be
generated for the branch office; the branch can comply under the main code itself.
10. Once registered, can an employer edit the details already furnished online ?
As regards details pertaining to the employer, like name of the employer, address, etc., the
employer may submit a request online, supported by documentary evidence, and on approval
by the competent authority, the change will get effected in the system. As regards details
pertaining to the employees registered by the employer, except for the name and insurance
number of the employer, all the other details, including dependant details, address of the
employee, etc., can be edited by the employer.
11. How can an employer, who is registered under the Act, register it‘s employees under the
Scheme?
The employer, once allotted the ESIC registration number, can login to the employer portal
and register it‘s employees, as soon as they are employed by it. In case of first employment (
the employee has not worked anywhere before joining the employer), the employee has to
register the employee under the ESI Scheme, submitting the details of the employee, his
family members, place of residence of himself and that of his family members, the
dispensary to which they want to avail medical treatment, etc; once registration is
completed, the employee will be allotted an insurance number, which is unique and will be
valid throughout the life of the employee, even if the employee changes job. In case, the
employee is already having an insurance number, the employer has to enter that number
and proceed with updating the details of the employee.
12. Can an employee, who is already having an insurance number, be allotted an insurance number
afresh, when he joins a different organisation?
No. The insurance number is unique for each employee and is valid throughout the life of the
employee, irrespective of his changing jobs. The eligibility criteria in respect of various benefits
under the ESI Scheme is based on the number of days for which an employee is covered under
the Scheme. The number of days for which an employee is covered under the Scheme is
reckoned irrespective of the different employers under which the employee has worked. If an
employee who is already having an insurance number is registered again, the employee might
not satisfy the eligibility criteria in respect of various benefits, and as a result would be denied
the benefits, which he /she would have got, had the fact of existing insurance number is
disclosed.
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13. Should the employer register all the employees employed by it under the Scheme, even if
they are not entitled for benefits under the Scheme ?
No. As only those of the employees whose monthly remuneration (excluding overtime wages)
does not exceed Rs.15,000 per month are entitled for coverage under the Scheme, the
employer need to register those employees alone. (However, for the purpose of coverage
under the Scheme, i.e., whether the employer has employed ten or more employees, all
employees employed by the employer, irrespective of the salary are reckoned).
14. Is it necessary to register temporary employees, casual labour, etc., employed by the
employer apart from registering the employees on their roll ?
Yes. All employees, including casual labour, temporary employees, employees employed
through contractors (outsourced) etc. have to be registered by the employer.
15. Who is responsible for the registration of contract employees employed in an organisation -
the organisation where the contract employees are deployed, or, the contractor who has
employed them?
The organisation which utilises the services of the contract employees need not register these
employees under the Scheme, if they are already registered by the contractor. However, as
the principal employer, that organisation would be responsible for the remittance of
contribution in respect of such employees by the contractor under the ESI Act. So, the
organisation employing outsourced employees should ensure that the contractor through
whom these employees are employed is complying under the provisions of the Act.
16. What is the proof of registration of employees?

Once registered, in respect of employees who are being registered under the Scheme
afresh, an insurance number is allotted and a Temporary Identity Card (TIC) is generated;
this TIC is valid for a period of 3 months from the date of registration, within which the
employee has to enrol for the Pehchan card. In case of employees who are already
registered, their name would be linked to the current employer, which can be checked in the
employer‘s portal as well as the employees‘ portal.
17. Whether any special provisions are there in respect of for physically disabled employees ?
Yes. In respect of physically disabled employees, the wage ceiling is Rs.25,000/-, i.e., they
are
entitled to the benefits under the Scheme, till their monthly remuneration exceeds Rs.25,000
per month. As regards remittance of contribution, the employer is exempt from payment of
contribution for four year in respect of the disabled employees (the Central government
remits the contribution on their behalf). (However, the employee‘s share need to be remitted
by the employer).
18. What is the procedure for availing the special provisions in respect of physically disabled
employees?
For availing the benefits of this provision, the disabled employee has to be registered as if
he / she is an employee without any disability; subsequent to registration, the employer
need to approach the branch office along with the documents in proof of the disability (for
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eg. certificate of disability issued by a Civil Surgeon). On submission of these documents, the
branch manager would incorporate the details of disability in the system; once incorporated,
these special provisions would come in to effect.
19. Are there any other exemptions in respect of any special category of employees ?
Yes. In respect of employees whose average daily wages is less than Rs.100 per day, the
employee‘s share need not be paid. However, the employer‘s share (4.75% of the wages)
need to be paid.
20. How is contribution to be paid by an employer arrived at and submitted ?

The employer has to file the details of contribution payable in respect of each month, latest
by the 21st of the succeeding month, online. If the contribution is not filed and the amount
payable remitted by 21st of the succeeding month, the employer would be liable to pay
interest and damages for delayed payment. The employer can file the contribution in the
respective screens in the employer portal, or it can use the the prescribed spreadsheet
template (MS-Excel) which can be downloaded from the employer portal and upload the
template file, duly filled in.
21. Once contributions is filed and the amount payable arrived at, what is the mode of
remittance of the contribution?
Once the contribution payable is arrived at, challan has to be generated for the said
amount; while generating challan, the mode of payment is to be selected, i.e., cash, demand
draft or cheque. Once the challan is generated, the same has to be submitted along with the
requisite cash, cheque, as the case may be, in any of the branches of the State Bank of
India. Employers having internet banking facility with the State Bank of India, may also remit
the contribution online.
PEHCHAN CARD
22. What is Pehchan card?

All the employees who are entitled to benefits under the Scheme are issued a set of two
smart cards, christened ‗Pehchan Card‟. Using this card, the employee can go to the ESI
dispensary and avail medical treatment. One card is meant for the employee, i.e., the
Insured Person (IP), and the other card is meant for the family members. In case the family
members of the IP are staying in a different town / city, they can avail medical facilities of
ESI Scheme in a dispensary located near their residence with the other card. The Pehchan
card has the insurance number, name of the IP and the photograph of the IP/ family
members printed on it.
23. What is the procedure for obtaining the Pehchan card ?
On the employer registering the employee, an insurance number is generated and the
employee becomes an Insured Person (IP). The employer has to take a print of the
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Temporary Identity Card (TIC), generated after completing the registration of the
employee; the TIC, along with the family photo of the IP, both duly attested by the
employer, should be handed over to the IP. The IP has to take these documents, and
approach the nearest branch office, wherein the IP‘s photograph would be taken and the
the fingerprints of the IP and his/ her family members would be scanned. On completion of
the procedure, the Pehchan card would be delivered to the IP, in about 2 weeks‘ time.
24. Should an IP go only to the branch office to which he / she is attached to, for enrolment of
pehchan card ?
No, The IP can go to any of the ESIC offices situated in the country to get enrolled for
pehchan card. However, the card would get printed only in the Regional Office / Sub-
regional office in which he / she is registered.
25. Should the IP go along with all the family members for enrolment of Pehchan card ?
No, the IP can go and enrol for the Pehchan card in the first instance and then get the family
members alone enrolled subsequently. However, in case of family members of IP, who are
minors, the IP has to necessarily accompany them while enrolling for smart cards. In respect
of family members who are not minors, the family members, without being accompanied by
the IP, can get enrolled, provided they take the TIC and family photo / Pehchan card.
26. If the family members get enrolled subsequent to the enrolment of the IP, how will their photo
appear in the Pehchan card ?
Photograph of only those of the family members, who enrolled along with the IP in the first
instance would appear in the smart card. However, the photograph of the family members
would be stored in the system and as when the card is swiped, all the photographs would
appear in the computer screen. The IP should continue using the card issued in the first
instance. No further cards would be issued just for the sake of the photograph of the family
members not displayed in the Pehchan card.
27. Can the family members of the IP enrol in their place of residence while the IP enrol in his
place of work, where the IP and his / her family members are residing in some other town /
village / state ?
Yes. The IP, after enrolling himself / herself, may send the duly attested TIC and family
photo by post to his / her family members, who in turn can enrol in the ESI office near their
residence.
28. Will the IP get a new card if he / she changes employment ?

No. The Pehchan cards issued is for life. The IP should use the same card even if he / she
changes employment.
29. Can the IP enrol again if the IP loses the card / the card gets destroyed / damaged ?
No. The IP should not enrol again under any circumstances. If the IP enrols for the second
time, the system would block the printing of the Pehchan card in respect of enrolment done
for the second time, by matching the fingerprints already there in the system. In case the IP
loses the Pehchan card he / she has to contact the branch office to which he /she is
attached; on payment of a fee of Rs.25/- duplicate card would be issued to the IP.
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30. Whether it is possible for an employer to get it‘s employees enrolled for Pehchan card in it‘s
premises?
Yes. In case, where the number of employees to be enrolled is not below 80, ESIC can
arrange the enrolment of the employees pertaining to the employer at it‘s premises, by
sending it‘s technical team, subject to certain conditions. The employer has to approach the
respective Regional Office / Sub-regional office with a request in this regard.
BENEFITS
31. What are ‗contribution periods‘and ‗benefit periods‘?

A financial year is divided into two six months span, i.e., April to September and October to
March. Each of the six monthly period is called a ‗contribution period‟. Similarly, a calendar
year is divided into two six monthly span, i.e., January to June and July to December, with
each of the six monthly period being called a ‗benefit period‟. For the contribution paid in
the contribution period from April to September, an IP would be eligible for benefit in the
period from January to June. Similarly, for the contribution paid in the period from July to
December, the IP becomes entitled to benefits in the benefit period from July to December.
Thus, the entitlement to benefits of an IP during a benefit period is decided based upon the
number of days for which contribution is being paid in the contribution period
corresponding to the benefit period.
32. How superior is the ESI Scheme as compared to the Mediclaim policy / Group mediclaim
policy issued by the general insurance companies.
The benefits under the ESI Scheme are far superior as compared with the risks covered under
the mediclaim policies. Medical care is only one of the many benefits available to the
beneficiaries under the Scheme. Even this one benefit comes out far superior when compared
with the mediclaim policies, as detailed below:
Commercial medical insurance ESI Scheme - medical benefit

Commercial motive Welfare motive
Uniform rate of contribution for all age

Premium based on age, sum insured & claims groups
experience
Medical check up reqd. for certain persons No medical checkup required for anyone
Ceiling on overall benefit (sum insured) as well No limit on medical benefit

as compartmental limits
Exclusions prescribed No exclusions
Family members of IP covered at no extra

Extra premium for covering family of insured cost
person (IP)
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Provides many benefits in addition to

Only medical benefit medical
benefit
No choice of class of treatment-only
Choice of class of treatment(general ward, pvt. general ward
/ semi pvt. ward, etc.)
33. What is medical benefit?

Medical benefit means medical care to the IPs and their families. Medical benefit is provided in
kind through a network of hospitals and dispensaries coming under the administrative control of
the State Government and through ESIC Model Hospitals and Hospitals coming under the
administrative control of the ESI Corporation. This benefit is uniform to all according to their
requirement without disparity or linking it to their wages and contributions paid. It is the only
health insurance scheme in the world, which has no upper ceiling on expenditure on medical care of
beneficiaries.
34. What are the eligibility conditions to become entitled to medical benefit?
A person who is covered under the scheme for the first time is eligible for medical care for self
and family for three months. If, he /she continue in insurable employment for three months or
more, the benefit is admissible till the beginning of the corresponding benefit period. If the
insured person is under ESI coverage for at least two years and contributed for not less than 156
days, and is suffering from any of the 34 specified long term diseases, the medical benefit is
admissible till the incapacity lasts or for a period of 2 years for self and family.
35. Whether the family members of the IP who are staying in a different place from that of the IP
avail medical care in their place of residence ?
In case the family members of the IP are staying in a different town / city from that of the IP,
and this fact is declared online by the employer, they can avail medical facilities of ESI Scheme
in a dispensary located near their residence with the pehchan card. (the IPs are given a set of
two pehchan cards).
36. What is the procedure to avail medical benefit when an insured person leaves station for a
temporary period ?
While leaving the station, the insured person may obtain a certificate of employment from his
employer in Form ESIC – 105. Based on this certificate and pehchan card, the insured person can
avail medical benefit in any ESI Dispensary/Hospital across the country. On the basis of the
Pehchan card, the insured person and his /her family can avail medical benefit in any ESI
Dispensary/Hospital after the computerisation process is completed.
37. How are medical treatment administered to the beneficiaries if any of the ESI hospitals are not
having the requisite facilities (super specialty treatment) ?
The State Medical Commissioner/Medical Superintendents of ESIC Hospitals/Director, ESI
(Medical) Services, have entered into tie-up arrangements with recognized medical institutions to
provide cashless treatment to insured persons and their family members for treatment that are
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not available in ESI/ESIC institutions to ensure that the ESI beneficiaries are provided full
medical care. In order to avail treatment in such hospitals, the insured persons are required to
obtain eligibility certificate from the concerned Insurance Medical Officer of ESI/ESIC hospital,
referring the insured person or his dependents to such hospitals.
38. What are the eligibility conditions for availing the super specialty treatment ?
The eligibility conditions are as follows:
 An insured person who is eligible for medical treatment is entitled to avail Super Speciality
treatment, for self and his/her family.
 A newly registered employee is entitled to avail super speciality treatment for self, on
completion of three months of service in insurable employment and contribution should have been
paid/payable for not less than 39 days during that period.
 A newly registered employee ‗s dependents are entitled to super speciality treatment on
completion of six months of service in insurable employment and contribution should have been
paid/payable for not less than 78 days during that period.
The concepts of contribution period and benefit period will not apply while deciding the eligibility
of an IP for Super specialty treatment.
39. Whether a beneficiary can avail the super specialty treatment in a state different from that of
the state in which the IP is registered ?
Yes. The procedure for the same is as follows:
 The referring hospital/dispensary shall send a copy of the reference slip to the
SSMC/SMC of the referring and the referred state from where the patient wants to
avail, the required super-speciality treatment.
 SSMC/SMC of the state from where the patient wants to take treatment, shall intimate
the network/tie-up hospital for providing necessary/required treatment. Thereafter, the
bill for payment may be sent to the SSMC/SMC of the state from where he was referred
on completion of treatment.
40. A brief note on the infrastructure for ESIC for extending medical care to the beneficiaries.
Since the inception of the scheme, the infrastructural network of the Scheme has
been expanding to meet the social security requirements of an ever increasing worker
population. Full range of medical, surgical and obstetric treatment consisting of out-door
treatment, in-patient treatment, supply of all drugs and dressings, pathological and
radiological investigations, prenatal and post-natal care, super speciality consultation and
treatment, ambulance services, provision of artificial appliances etc are provided to the ESI
beneficiaries through a network of dispensaries/hospitals and recognized medical
institutions where tie-up arrangements have been entered into to provide cashless treatment.
The ESIC hospitals at Rajajinagar and Peenya and ESI Hospital at Indiranagar in
Bangalore have been provided with sophisticated equipments for detection and treatment of
various diseases. ESI Hospital at Indiranagar has facility for dialysis and the ESIC hospital at
Rajajinagar has been modernized and has upgraded facilities viz., C.T. Scan, MRI, Blood
bank, ICU. centralized gas pipe line, modern laundry and kitchen. Further, ESIC has entered
into MOU with Jayadeva Institute of Cardiology and commissioned cardiac centre at ESIC
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Model Hospital.
The ESI beneficiaries can avail medical benefit through a network of
hospitals/dispensaries/panel clinics/recognized medical
41. What is sickness benefit?

Sickness signifies a state of health necessitating medical treatment and attendance and
abstention by the IP from work on medical grounds. Financial support extended by the ESI
Corporation in such a contingency is called Sickness Benefit. This benefit is paid for the period of
abstention, duly certified by the Authorized Medical Officer.
42. What are the eligibility conditions for availing sickness benefit ?
The eligibility criterion for availing sickness benefit are as follows :-
 On completion of nine months in insurable employment.
 Should have paid contributions for not less than 78 days in the corresponding contribution
period.
 Eligible for 91 days Sickness Benefit in two consecutive benefit periods.
 Benefit is not paid for an initial period of two days during the certified period of illness known
as waiting days.
If the insured person is certified sick within 15 days of the last spell, the waiting period is not
reckoned and benefit is payable from the beginning of the spell.
43. What is the quantum of sickness benefit payable ?

Sickness Benefit is payable @ 70% of the average daily wages of the IP.
44. What is Extended Sickness Benefit ?

Extended Sickness Benefit is paid for prolonged illness due to 34 specified diseases, over
and above the sickness benefit. Extended sickness benefit may also be sanctioned by the
prescribed authority in case of any rare disease or special circumstances on the
recommendation of the specified authority.
45. What are the conditions for availing Extended Sickness Benefit ?
The eligibility criteria for availing Extended Sickness Benefit are:
 Should be an insured person on the date of commencement of spell of extended sickness

benefit.
 Should have been employed continuously for a period of 2 years or more in covered
factory or establishment.
 Continuous employment means that the insured person should have completed four
contribution periods immediately preceding the spell of sickness.
 Contributions should have been paid/payable for 156 days in the above said four
contribution period.
 The insured person should be eligible to claim sickness benefit in at least one of the four
contribution periods.
The above conditions may be relaxed on humanitarian grounds, subject to sanction by the
appropriate authority and based on the following criterion:-
 Those who have not completed two years but have paid contributions for
156 days and also qualified for SB in one of the contribution periods.
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 Those who have completed two years and also paid contributions for 156
days, but are not eligible for SB in any contribution period.
46. What is the scale of Extended Sickness Benefit

payable ? The scale of benefit is as follows :-
 After exhausting 91 days of Sickness Benefit, ESB is payable upto 124/309 days i.e.,
which includes SB for 91 upto 400 days.
 Upto 2 years ie., 730 days in special circumstances or till the insured person attains 60
years, whichever is earlier, subject to recommendations of the appropriate authority.
 Payable @ 80% of average daily wages.
47. What is enhanced sickness benefit and who can be availed?

To promote the norms of small family, this cash benefit is paid to the insured person for
undergoing vasectomy/tubectomy operation. The eligibility criteria and scale of benefit are
:-
 Should have paid contributions for not less than 78 days in the corresponding
contribution period.
 Benefit payable for 14 days for tubectomy and 7 days for vasectomy.
 For post operative complications of tubectomy, benefit can be extended by the
appropriate authority beyond 21 days.
 Benefit is payable @ 100% of average daily wages.
48. What is an employment injury ?

It is a personal injury caused by an accident or occupational disease arising out of and in
the course of his insurable employment within or outside territorial limits of India. The law
relating to employment injury has been liberalized. An accident arising in the course of
employment is presumed also to have arisen out of employment if there is no evidence to the
contrary. An accident which may occur while commuting between the place of residence and
workplace is also treated as notional extension of employment, and as a result, and the
injury sustained from such an accident is construed as employment injury, if, the nexus
between the time, place and circumstances and employment is established, for purpose of
disablement or death benefit.
49. Whether the employer is entitled to claim reimbursement in respect of first aid, medical care
and transport of the IP who has sustained employment injury ?
Yes. The employer, could furnish the claim along with the supporting document in respect of
the expenditure incurred, along with the undertaking from the IP that he / she has not borne
any of the expenditure for which reimbursement is being claimed by the employer. The
employer should also ensure that Accident report in form-12 is submitted to the branch office
to which it is attached to, at the earliest (the report may also be submitted online).
50. What is disablement ?

Disablement is a condition resulting from employment injury which may render the insured
persons disabled. The various types of disablement are:
1. Temporary disablement - rendering an insured person incapable of work temporarily
and necessitating medical treatment.
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2. Permanent Partial disablement – reducing the earning capacity of the insured person.
3. Permanent Total disablement – totally depriving the insured person of the power to do
any work.
51. Which of the diseases fall under the category ‗ occupational diseases‘ ?
Occupational diseases are such diseases that the IP is susceptible to as a result of engaging
in a specific occupation. Contracting any disease while in employment for a specified period
in any of the industries listed in Part, A, B & C of Schedule III of the ESI Act, which
enumerates the industrial processes involving exposure to the diseases and the
corresponding compensable occupational diseases, are thus recognized for payment of
disablement benefits without any further evidence.
52. What is Temporary Disablement Benefit ?

It is a periodical payment to an insured person suffering from disablement as a result of
employment injury for the period of abstention from work certified by an authorized Medical
Officer. The salient features and scale of benefit are as follows :-
 From the very first day of entering into insurable employment, the insured person is
entitled to this benefit irrespective of having paid any contribution.
 Temporary Disablement Benefit is payable to the insured person after the accident is
accepted as employment injury.
 The benefit is payable as long as the temporary disablement lasts and is duly
certified.
The quantum of benefit is 90% of average daily wages.
53. What is Permanent Disablement Benefit ?

Due to employment injury, if an insured person has any residual disability of permanent nature,
the insured person is referred to a medical board and the loss of earning capacity is assessed, if
any, as per Schedule II of the ESI Act, as well as non-scheduled injuries resulting
from employment injury. Thereafter the insured person is paid monthly periodical payments of
permanent disablement for life from the date of termination of temporary disablement benefit
at the percentage awarded by the Medical Board out of the full daily rate of temporary disablement
benefit. In case, the insured person has not been certified temporarily disabled between the
date of injury and the date of assessment by the medical board, permanent disablement if
assessed is payable from the following date of employment injury due to accident.
54. How is Permanent Disablement Benefit disbursed to the IPs ?

The benefit is processed by the Regional Office /Sub Regional Offices/Divisional Office and
credited to the bank account of the insured person every month. Payments are disbursed by
Branch Offices in respect of cases not processed RO/SRO/DO. The insured person can also opt
for the payment in lump sum, if his daily rate of Permanent disablement benefit does not exceed
rupees five per day or in case it exceeds rupees five per day, but the commuted value does not
exceed rupees thirty thousand. The insured person is required to submit life certificate once a
year during the month of January every year and an amount of Rs.100/-would be paid as
conveyance to the concerned insured person.
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55. What is Dependant Benefit ?

Dependent‘s benefit is a monthly pension payable to the eligible dependents of an insured
person who dies as a result of an employment injury or occupational disease. Dependent benefit
is payable from the next day of death. The eligibility condition, periodical payment, mode of
payment and the calculation of the rate of benefit are similar to Permanent Disablement benefit.
56. What is the quantum of dependant benefit payable among the dependants of a deceased IP
?
The dependant benefit is distributed amongst the eligible dependents in the following ratio
:-
 Widow – till life or re-marriage – @ 3/5th of full rate
 Widowed mother - @ 3/5th of full rate
 Sons - @ 2/5th of the full rate till he attains the age of twenty five years and is
dependent
 Daughters - @ 2/5th of the full rate until marriage.
 If the son or daughter is infirm and wholly dependent on the earnings of the insured
person, at the time of death of insured person, will continue to receive benefit even
after attaining 25 years /marriage as the case may be.
 If the insured person has no family of his own, the dependent parents are entitled to
3/10th each of the full rate.
While calculating the rate, if the total dependents‘ benefit for all the dependents
exceeds the full rate at any time, the share of each dependent should be
proportionately reduced, so that the total amount payable to all dependents does not
exceed the full rate. Further, the ESI Corporation has enhanced the minimum pension
to Rs.1200/- per family.
57. Is there any provision in the Scheme to rehabilitate the IP who are disabled due to
employment injury ?
Vocational Rehabilitation Scheme for disabled IPs is provided to insured persons whose loss
of earning capacity resulting from employment injury has been assessed as not less than
40% as per the Second Schedule to the Act and for scheduled as well as non-scheduled
injuries resulting from and employment injury. Subject to the following :-
 Should be in receipt of PDB
 Should not be in any gainful employment
 Should not be more than 45 years of age as on the date of his application
A cash allowance of Rs.123/-per day will be paid by the centre/vocational rehabilitation
centre during the period of training and conveyance /journey fare by second class
railway/bus whoever is applicable will be paid.
58. What is maternity benefit ?
Maternity Benefit is cash payable to an insured woman for a specified period of abstention
from work, due to confinement, miscarriage or sickness arising out of pregnancy, pre-mature
birth of child or miscarriage or confinement. ‗Confinement‘ connotes labour resulting in the
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delivery of a living child or labour after 26 weeks of pregnancy whether the resultant issue
is alive or dead.
‗Miscarriage‘ means expulsion of the contents of a pregnant uterus at any period prior to or
during the 26th week of pregnancy. Criminal abortion or miscarriage does not entitle the
insured woman the benefit.
59. What are the conditions subject to which maternity benefit is payable ?
The conditions for availing maternity benefit are as follows:

 Payment of contribution for not less than 70 days in the immediately preceding two
contribution periods.
 Confinement should actually occur or expected to occur in a benefit period relevant to the
insured woman, i.e., if she actually confines or expected to confine before the start of the
first benefit period, is not entitled to claim, even though, a part of the maternity leave will
fall within her first benefit period.
 If an insured woman‘s actual date or expected date of confinement, falls within her first
benefit period, she will be entitled to maternity benefit even if a part of the maternity
leave may fall before the start of the first benefit period.
 Upto 12 weeks in the case of normal delivery, upto 6 weeks in the case of mis-carriage.
Extendable by 4 weeks on medical advice.
 Benefit payable at almost 100% of average daily wages.
 Benefit is paid only if the insured woman does not work for remuneration during the
period for which benefit is claimed irrespective whether she received any leave wages
also for the days of abstention or was on strike during the same period.
60. What is medical bonus?

Medical Bonus is lump sum payment made to an insured woman or an insured person in
respect of his wife towards confinement expenses, if the confinement occurs at a place where
facilities under the ESI Scheme were not available. An amount of Rs.2,500/- are payable for
each confinement and are restricted upto only two confinements.
61. What are the provisions regarding defrayment of funeral expenses ?

A lump sum payment towards expenditure on the funeral of a deceased insured person is
paid either to the eldest surviving member of the family or if he has no family or not residing
with his family at the time of death, to the person who actually performs the funeral of the
deceased insured person. The funeral expenditure can be claimed subject to the following :-
 The insured person should have been an insured person at the time of his/her death.
 There is no contributory condition for admissibility to this benefit but should be
entitled at least to medical benefit on date of death.
 The dependents of an insured person in receipt of Permanent Disablement Benefit,
even though may not have been in insurable employment at the time of death, can
claim funeral expenditure.
 The actual amount incurred or a maximum amount of Rs.10,000/- whichever is less, is
payable to the claimant based on proof of death of insured person.
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62. Are there any benefits for the IPs who are rendered unemployed ?
Yes. An insured person is entitled to claim unemployment allowance under Rajiv Gandhi
Shramik Kalyan Yojana (RGSKY), subject to the following situations – He / she is rendered
unemployed due to retrenchment or closure of an factory/establishment as defined under
the Industrial Disputes Act, 1947 and due to permanent invalidity above 40% arising due to
non-employment injury and which is duly certified by a Medical Board duly constituted by
the State or Central Government. The insured person is required to fulfil the following
criterion to claim the allowance:
 The applicant should have been an insured person as per the ESI Act as on the date
of loss of employment due to retrenchment, closure or permanent invalidity arising
out of non-employment injury.
 Contributions should have paid payable for a minimum period of three years prior
to the loss of employment,
 Should have paid 156 days or more in any two consecutive contribution periods
which are to be reckoned.
 Claim should be submitted within 9 months from the date of being rendered
unemployed.
 The benefit is payable for a maximum period of twelve months during their entire
life time.
 Entitled to medical benefit along with their dependent family members during the
period from ESI Hospital/dispensaries, panel doctors to which they were attached
prior to loss of employment.
 Benefit is payable @ 50% of the average daily wages.
63. Is there any provision to rehabilitate the IP who are rendered unemployed?
Yes. The insured person entitled to this skill development scheme should be in receipt of
unemployment allowance under RGSKY.
 The duration of the course is for a maximum period of six months and within the
period when they are receiving unemployment allowance
 Should not go beyond the last date of receipt of RGSKY
Training is admissible only once in the entire life time.
64. Are there any benefits for the retired IPs and permanently disabled IPs who cease to be in
insurable employment under the Scheme ?
a) An insured person who ceases to be in insurable employment on account of permanent
disablement can receive medical benefit till the date on which he would have vacated
employment on attaining the age of superannuation had he not sustained such
permanent disablement.
b) An insured person who has attained the age of superannuation or retires under
voluntary retirement scheme or takes premature retirement and their spouse can avail
medical treatment.
The above insured persons can avail the benefit subject to the following eligibility criteria :
 Should have been an insured person on the date of leaving employment due to
superannuation, voluntary retirement or premature retirement.
 Submits proof that he has remitted contributions for not less than 5 years.
 No other member of the family other than the spouse shall be eligible for this
benefit.
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 Entitled to medical facilities as if he is a regular insured person, except that super

speciality treatment will be not be admissible to such a person and his spouse.
 On the death of insured person, the spouse will be entitled to medical care upto the
date the insured person would have been entitled had he/she been alive.
It is to be noted that insured persons who have voluntarily retired / prematurely retired
w.e.f. 1.6.2010 are entitled to avail this facility.
65. Which office should the IP / employer approach for availing the benefits under the Scheme ?
The IP / beneficiaries have to approach the branch office to which they are attached to, for
availing the benefits under the Scheme.
66. Can the IPs avail more than one cash benefits at a time ?
An insured person shall not be entitled to receive for the same period —
(a) both sickness benefit and maternity benefit ; or
(b) both sickness benefit and disablement benefit for temporary disablement.
(c) both maternity benefit and disablement benefit for temporary disablement.
Where a person is entitled to more than one of the benefits mentioned in sub-section (1), he
/ she shall be entitled to choose which benefit he / she shall receive.
MISCELLANEOUS PROVISIONS
67. How can an IP ascertain the details of contribution paid, his / her eligibility to various
benefits, etc ?
The IP can log on to the IP portal (www.esic.in/employeeportal/login.aspx) with their

insurance number as the user id and ascertain the details of contribution paid on their
behalf, their entitlement to various benefits, etc.
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HANDBOOK ON

EMPLOYEE’S PROVIDENT FUND AND

EMPLOYEES STATE INSURANCE ACT’ 1948

EMPLOYEE’S PROVIDENT FUND

MISCELLANEOUS PROVISIONS ACT’ 1952

EMPLOYEES’ PROVIDENT FUND ORGANISATION

(2) Registration – Issue of Provident Fund Code Number- to an establishment.

(4) Voluntary application of Act:

(ii) Establishments employing 20 persons but not falling in the

list of notified industries/class of establishments.

 Provident Fund is a Social Security Benefit to employees.

Employees’ Provident Fund Act/Scheme

Employees’ Provident Fund Organisation(EPFO)

 Employees‘ Provident Fund Organisation is administering the above Schemes.

 Honorable Minister for Labour, Government of India is the Chairman of Central

Special Features of the Act/Schemes

 Employees‘ Provident Fund as also Provident Fund of exempted establishments is

2. WHO IS ELIGIBLE TO BECOME A PF MEMBER?

All employees, employed in an establishment (includes employees employed

―Excluded employees‖ need not be enrolled as PF members.

Excluded employees are –

b) Employees whose Employees‘ Provident Fund Accounts were once fully

An employee who is enrolled as a member of Provident Fund is automatically eligible

In case an employee had attained the age of 58 or is in receipt of pension under

BENEFITS UNDER EMPLOYEES’ PROVIDENT FUNDS SCHEME, 1952.

 Every employee is required to pay Contribution to the provident fund @

BENEFITS OF PENSION SCHEME

 Pension is a boon for the working class. It is no more the prerogative of

 The Pension is payable on attaining the age of 58 years, whether he is in service

The Pension quantum is determined separately for the period of service

The Pension for the service rendered on or after 16.11.1995 is calculated

Pensionable Salary x Pensionable Service

An employee on his superannuation is entitled for Pension (through the above

Benefits under Employees’ Deposit Linked Insurance Scheme, 1976

 A member of Provident Fund is also a member of Employees Deposit Linked

Scheme Employees’ share Employers’ share

(2) The employee‘s share of Provident Fund contribution may be deducted by

6. PROVIDENT FUND ADVANCES/WITHDRAWALS

 For financing Insurance policy,

How to avail Provident Fund advances?

The Provisions envisaged under paragraphs 62 to 68-O of the EPF Scheme

withdrawal under Para 62 for financing Life Insurance Policies.

7. HOW TO WITHDRAW PF AND OTHER BENEFITS?

If there is no valid nomination the Provident Fund amount is payable equally to

In such cases the claim is to be preferred by the eligible person through

A member of Employees‘ Provident Fund acquires membership under Pension

A Provident Fund member who is eligible to withdraw his Employees‘ Provident

A member of the Pension Scheme is eligible for the following benefits:-

On death of an employee, while in service, the family (spouse and children) is

Thus the benefits under Pension Scheme can be claimed as under:

2 Death after 10 years Below 58 Monthly Pension to the

3 Death after Below 10 Below 58 Family Pension to

4 Death while Not relevant Not relevant Family Pension to only

Claiming Withdrawal Benefit:-

In case a member who has not rendered 10 years service, he is eligible to

Claiming of Scheme Certificate

The Scheme Certificate received from the Regional Provident Fund

A member or the beneficiary can claim Pension through an application in Form

6. To claim the family pension, the widow/widower may submit only

Assurance benefit under Employees’ Deposit Linked Insurance

Benefits under the Employees’ Deposit Linked Insurance Scheme

8. TRANSFER OF PROVIDENT FUND ACCOUNTS

A Provident Fund member, on leaving an establishment and joining another